Quote from tobbe:
tiddlywinks -
This is a great thread. Please don't have it closed because of the trolls.
You trade several different futures markets (financials, softs etc) - do you need to adjust your method between markets (as in "do they behave different or have different personalities")?
Hi tobbe:
That's the great thing about PA trading. It's applicable across the board. The same patterns and pressures appear, it's magic! And as you mention personality of an instrument plays a part, definitely.
First consideration is bar interval, or put another way, how the trader views that market. Personality (the incremental changes in price) is affected by tick-size (amongst other things) and since the job of a trader is to make money, that's important! I use time-based bars and based on the personality of DX (20 ticks = $100) a one or two minute bar is too fast for intraday trading unless scalping. Conversely, a fifteen on SB (9 ticks = $100) is too slow as you would have few opps intraday. So the first thing the trader must understand about "personality" is the exact exchange specifications of the instrument being traded.
Second is grittier, and in my case directly affects my "methods"
Over 80% of my setups use a bar CLOSE. Some markets, and DX is the one that brought this to light for me, can (and should) be traded based on a PRINT. This also means some PA patterns become "less desirable". Case in point, the silly little Pipe Top that seems to have dominated my charts lately, where 2 bars form a LH or HH and have matching highs. Sure the pattern appears on a 15m DX but a setup without the matching high criteria appears more frequently, is as reliable, and much more desirable for on print entry/exit. BTW, Pipe Top appears regularly on DX with fast bars, but as mentioned, there is no money with DX and fast bars unless scalping.
Anyway,
there is much more to the topic of instrument personality. I hope I answered your question.
